Phosphorus Oxychloride 

*Short tons per year, phosphorus oxychloride (POCl₃) basis. Commercial production is by direct oxidation of phosphorus trichioride with oxygen. About 75 to 80 percent of phosphorus oxychloride production is estimated to be used captively in the manufacture of phosphate esters for plasticizers, flame retardants, hydraulic fluids and other applications.

FMC sold its process additives business, including phosphorus oxychloride and trichloride plants in Nitro, W.Va,, to Great Lakes Chemical in 1999. Astaris (which was formed as a joint venture between FMC and Solutia) continues to market phosphorus chlorides made at the Nitro plant under a long-term tolling agreement.

In March 2000, Rhodia acquired Albright & Wilson, making it the world's leader in specialty phosphates. A year earlier, Albright & Wilson had increased capacity at the Charleston, S.C. plant by 20 percent. To obtain the Federal Trade Commission’s approval, Rhodia divested Albright & Wilson's merchant phosphoric acid business in the US to Potash Corporation of Saskatchewan. Rhodia maintained its original merchant phosphoric acid position.

Profile last published 9/13/99; this revision, 8/26/02.

DEMAND
2000: 39,800 short tons; 2001: 40,500 short tons; 2005: 43,300 short tons, projected. Demand equals production plus imports (negligible) less exports (negligible).

GROWTH
Historical (1996 - 2001): 2.0 percent per year; future: 1.7 percent per year through 2005.

PRICE
Historical (1996 - 2001): High, $0.67 per pound, tanks, f.o.b. works; low, $0.62, same basis. Current: $0.67, same basis.

USES
Plastics and elastomers, 55 percent; functional fluids, 22 percent; pesticides, 7 percent; lube oil additives, 4 percent; surfactants and sequesterants, 2 percent; miscellaneous, 10 percent.

STRENGTH
Organic phosphate esters derived from phosphorus oxychloride are used as flame-retardants and plasticizers in a wide variety of plastics and elastomers. Demand for these additives is tied primarily to demand for plastics and elastomers used by the construction, automobile and transportation equipment industries. This is the largest segment for phosphorus oxychloride and the only growing segment, besides the small miscellaneous applications. Future growth in this segment should mirror GDP growth.

WEAKNESS
Demand for functional fluids, phosphorus oxychloride’s second largest application segment, is expected to be flat over the forecast period. Projects to minimize plant-operating costs have resulted in improved maintenance at many plants. Hydraulic systems have been tightened to avoid losses and consumption of makeup functional fluids has been reduced. Phosphate ester hydraulic fluids have been further impacted by less expensive 50:50 water:glycol solutions and polyol esters.

OUTLOOK
Only one application segment promises growth in demand for phosphorus oxychloride – plastics and elastomers additives. All other segments are expected to be flat, though not in decline. Thus, a modest aggregate growth of 1.7 percent annually is projected, through 2005.